ObamaCare Exemptions

Americans who don’t have health insurance or have ones that don’t meet ACA minimum essential standards, will have to pay a penalty fee. However, if you qualify for a health coverage exemption, you will not have to pay the fee.

There are two types of exemptions, regular exemptions and hardships exemptions. In general the hardship exemptions entails more documentations, but may provide additional support, beyond simply insurance, to the individual (Catastrophic coverage, Medicaid, local public programs, not paying a fee). Thus far, the government has identified around 40 possible exemptions.

How do I apply for exemptions? Different types of exemptions require different methods for claiming them, according to healthcare.gov. Certain exemptions you can apply through the marketplace (healthcare.gov), while other you can claim on your federal tax returns (Form 8965). There are a few which require both methods.

What exemptions do for you? In general, exemptions are qualifying life events that do one of the following:

Waive you from the individual mandate requiring you to have coverage, that is you won't have to pay the penalty

Allows you a special enrollment period during which you can buy a policy

Allows you to get catastrophic coverage outside of the marketplace

According to healthcare.gov, the following is a list of regular exemptions:

Income-Related exemptions:

Unaffordable Coverage: Even after applying subsidies, if the lowest-priced policy through the exchange costs more than 8.05% of your household income, you qualify for an exemption.

Similarly, if an employer coverage costs more than 9.5% of the your household income, you qualify for an exemption.

Low income: Individuals with income below the IRS threshold required for filing taxes are automatically exempted. The IRS threshold is $10,000 for an individual, and $20,000 for a married couple.

Health coverage- related exemptions

States opting out of Medicaid expansion: You live in a state that chose not to expand its Medicaid program, but if it did expand the program, you would have qualified for Medicaid.

Short coverage gap: If you went without coverage for less than 3 consecutive months during the year, you are exempted. This is mostly applicable to individuals who may want to opt-out of insurance temporarily because of life changes, such as moving to a new location or switching jobs.

Group membership exemptions

Religious reasons: If you are a member of a recognized denomination which oppose insurance, including Social Security and Medicare.

Health Care Sharing Ministry: If you are getting your health services paid for by a health care sharing ministry, you will be exempted; even though health care sharing ministry services are not recognized as a health insurance option, which does not meet the ACA standards.

If you are a member of a federally recognized Indian tribe or get services through an Indian Health Services provider.

Other Exemptions

Incarceration: If you are in prison, you are exempted.

Citizenship: If you are an American citizen living abroad or a non-citizen (green card holder) living in the states.

Hardship Exemptions:

In additions to the regular exemptions stated above, there are hardship exemptions (state below). Hardship exemptions refers to life events that prevent you from getting insurance.

Following is a list of ObamaCare Hardship Categories.

The Information below is obtained from Healthcare.gov.

You were homeless

You were evicted in the past 6 months or were facing eviction or foreclosure

You received a shut-off notice from a utility company

You recently experienced domestic violence

You recently experienced the death of a close family member

You experienced a fire, flood, or other natural or human-caused disaster that caused substantial damage to your property

You filed for bankruptcy in the last 6 months

You had medical expenses you couldn’t pay in the last 24 months that resulted in substantial debt

You experienced unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member

As a result of an eligibility appeals decision, you’re eligible for enrollment in a qualified health plan (QHP) through the Marketplace, lower costs on your monthly premiums, or cost-sharing reductions for a time period when you weren’t enrolled in a QHP through the Marketplace

You were determined ineligible for Medicaid because your state didn’t expand eligibility for Medicaid under the Affordable Care Act

Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable

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Jack is passionate about shining a light into the health insurance black box. As a co-founder of Take Command Health, he enjoys thinking of new tools and opportunities to empower consumers of health care. When not working on Take Command, he can be found with his family or watching college sports.